This article aims to help readers in answering the question of whether or not housing associations conduct credit checks while reviewing a candidate’s application. To discuss this in detail, we will also explore if there are any other forms of verifications conducted by housing associations as they process applications and the potential consequences of these checks.

Do Housing Associations Do Credit Checks?

Yes, housing associations will conduct credit checks as part of the verification process while they shortlist eligible candidates who can be allotted social housing residences. 

A regular credit check includes the following:

  • County Court Judgements to see if an applicant owes money and has not been able to pay it back
  • Bank statements, credit card statements and personal financial statements (if any) to check the income and expenses of the applicant and if they can afford rental payments
  • Adverse credit details to check if the candidate has arrears, delayed payments or debts

The main reason for conducting a credit check is to confirm the financial status of an applicant as per the statement made in their claim as well as to ascertain whether or not they will be able to make rental payments on time.

In some cases, housing associations may skip credit checks mainly due to the time it can take or when someone needs urgent housing. This can be due to the risk of homelessness or if they are escaping from domestic abuse or if they are being transferred from a shelter, hostel or another social housing residence.

However, whenever housing associations conduct a credit check, they inform the applicant beforehand and may even state the reason(s) why they feel the need to conduct a credit check in the first place.

If you know that you have a bad credit history, it is best to inform the housing association in advance rather than waiting for them to go through a credit check to discover that you have unpaid debts. In addition to this, you should also explain the reason for having a bad credit history by providing reasonable evidence to support your claim. If you can satisfy the concerns of the housing association regarding your ability to make timely rental payments, you may still qualify for social housing despite having a bad credit history.

Even if the housing association does not go through a credit check, they will ask for personal and financial documents during the verification process of your social housing application. 

Which Financial Documents Do I Need To Share With Housing Associations?

When you apply for social housing accommodation, you will be asked to provide copies of the following documents or hold a one-on-one meeting with your social housing landlord to review them:

  • council tax or utility bills or a copy of your tenancy agreement as proof of residence 
  • birth certificate, driving licence, medical card or passport as proof of identity 
  • candidate’s and partner’s wage slips, a letter from employer benefits book/letter, bank statements showing payments, private/work pension details, mortgage statement, the current valuation of the property (if any) as proof of income from earnings and benefits 
  • tax letters, wage slips, P45/60, National Insurance number card as proof of National Insurance number
  • bank/building society passbooks/statements/letters, national savings and share certificates as proof of current account deposit and savings 
  • child benefit book, proof of child benefit payments, a birth certificate as proof of dependents
  • wage slips and benefit book as proof of non-dependents

Are There Any Other Checks That Housing Associations Conduct?

Yes, there are other checks as well that housing associations conduct as part of the verification process while considering applications for social housing. These include the following:

  • If you are not a UK citizen or a resident with an unlimited right to stay in the UK, the housing association will check whether you and any other adults living with you have the “right to rent” in the UK. This means that you will need to provide them with a copy of your passport or immigration documents.
  • You will be asked to share letters of reference from your current and previous landlord(s) (if any) who can confirm that you will be a good tenant. You will also have to provide a letter of reference from your employer.
  • You will need to provide recent bank statements to provide proof of your income. If you are self-employed, you will have to provide copies of statements of your trading account and an accountant’s reference.
  • If you have not rented before, you will have to provide the name and details of a guarantor. This is someone (usually from your family) who guarantees to pay rent on your behalf if you are unable to pay your rent on time. 

Can You Be Refused Housing After A Credit Check?

Yes, your application for social housing can be refused by a housing association if your credit check reveals a bad credit history.

In addition to this, they may also refuse social housing to applicants on the following grounds:

  • you owe rent to a housing association, the council or a private landlord
  • there is evidence of nuisance or annoyance to neighbours
  • an offence committed in the previous accommodation (this may include causing damage to property, selling drugs, or robbery in a neighbour’s house)
  • conviction or a caution for an offence 
  • court action taken concerning tenancy eviction within the previous 2 years 

One of the ways that some applicants can still qualify for social housing despite having a bad credit history is by appointing a Guarantor to their tenancy agreement. The Guarantor will then become party to the tenancy contract by agreeing to pay rent on behalf of a social housing tenant if they fail to do so on their own.

If you believe that your social housing application has been refused in error, you can get your credit score from a credit reference agency such as Experian, Equifax or TransUnion and file an appeal.

Conclusion:

The above discussion has clearly outlined that housing associations will conduct credit checks in nearly all cases. This is the reason why one must make sure that they provide accurate data and verifiable documents during their assessment of social housing. Candidates are further advised to inform their housing association landlord in advance if they have a bad credit history and provide a reasonable explanation as well so that their application can still be considered by them.

References:

Checks your landlord or letting agent will make – Citizens Advice

Housing association homes: Apply for a home – GOV.UK

Credit Checks for Landlords